Financial report for the period April 1, 2001 - March 31, 2002
5/15/2002 12:48 PM EST
LAGERCRANTZ GROUP
Net revenues amounted to MSEK 1983 (2614)
Operating income amounted to MSEK 81 (118). This result includes items
affecting comparability in an amount of MSEK 0 (-45)
Cost reduction measures implemented during the year have lowered
overhead in the Group by about MSEK 70 on an annual basis.
Cash flow from current operations amounted to MSEK 158 (203).
After the repurchase of own shares, the Group's equity ratio stands at
55 percent (37).
Earnings per share amounted to SEK 1.96 (2.69)
A cash dividend of SEK 0,90 is proposed.
From April 3, 2002 the Group is organized in three divisions.
All comparative data are pro forma, based on the assumptions set forth
in Information to the shareholders of Bergman & Beving AB relating to
the distribution of the Lagercrantz Group AB. Comparative data for prior
years have been adjusted for the effect of applying recommendation RR9
(Income taxes) of the Swedish Financial Accounting Standards Council.
NET REVENUES AND INCOME
Net revenues declined to MSEK 1983 (2614). Operating income amounted to
MSEK 81 (118) with an operating margin of 4.1 percent (4.5). Income
before financial items amounted to MSEK 79 (113). This result includes
items affecting comparability in the amount of MSEK 0 (-45).
Earnings per share were SEK 1.96 (2.69).
A continued low level of demand in the telecom and electronics
industries marks the Group's operations. The downward economic trend is
seen most clearly in division Components, which is the Group's main
business. The large loss of volume resulted in lower earnings despite
forceful measures to reduce costs by approximately MSEK 70 on an annual
basis.
Sharp focus on the development of working capital has strengthened the
Group's financial position.
Restructuring costs of MSEK 39 were charged to the restructuring reserve
set aside at financial year-end March 31, 2001. The entire reserve has
thus been utilized.
In order to increase future opportunities for profitable growth with the
priority areas of electronics and communication the business within
information and payment systems was disposed in March 2002.
The Group is from April 1, 2002 organized in three divisions:
Components, Production Services and Communication.
BUSINESS AREA ELECTRONICS
Net revenues declined to MSEK 1207 (1694). Operating income before items
affecting comparability amounted to MSEK 58 (137), which is equivalent
of an operating margin of 4.8 percent (8.1).
COMPONENTS
Net revenues declined to MSEK 1009 (1490) and operating income before
items affecting comparability amounted to MSEK 49 (111). The operating
margin was 4.9 percent (7.4).
Components continues to be affected by the recession and the market's
outlook is uncertain.
An extensive cost savings program was implemented during the year. Among
measures taken is a reduction in personnel by about 85 persons. The
aggregate cost reduction is estimated to amount to about MSEK 55 on an
annual basis.
From April 1, 2002 the Group's business in industrially oriented systems
components was integrated in Components. This business, which was
previously a part of Systems, is included in the division's efforts in
the area of industrial communication.
PRODUCTION SERVICES
Net revenues amounted to MSEK 198 (204) and operating income before
items affecting comparability declined to MSEK 9 (26). The operating
margin was 4.5 percent (12.7).
After a deteriorating business trend during the third quarter, the flow
of new orders has now stabilized.
The number of employees was reduced by about 40 and the cost level has
been reduced by about MSEK 10 on an annual basis.
An investment in the expansion of value-adding services and products was
made during the year by establishing the 2B Electronics business.
The concept of offering holistic solutions with, among other things,
development and production preparation of electronics applications has
been well received in the marketplace. Some time and investment is
required, however, to establish a new concept in the market.
In order to strengthen further the division's contact network in the
Asian electronics market, 2B Electronics Asia Ltd. was established in
Hong Kong during the year. The company is a joint venture with a
regional partner.
BUSINESS AREA SOLUTIONS
Net revenues amounted to MSEK 776 (920). Operating income before items
affecting comparability amounted to MSEK 20 (22), which is equivalent to
an operating margin of 2.6 percent (2.4).
IT/COMMUNICATION
Net revenues for the operating area amounted to MSEK 395 (400) and
operating income before items affecting comparability amounted to MSEK
12 (19). The operating margin was 3.0 percent (4.8).
Profitability was negatively affected by an unsatisfactory development
of consulting operations in customer relationship management (CRM) and
IT Service Management (ITSM). An action program for cost reduction has
been implemented.
Operations in security solutions and satellite and video communication
saw a positive development, while the telecom-oriented communications
business is experiencing postponement of projects.
SYSTEMS
Net revenues declined to MSEK 381 (520) and operating income amounted to
MSEK 8 (3). The operating margin was 2.1 percent (0.6).
As a result of the Group's ongoing process of evaluating future
development opportunities, the business in information and payment
systems was sold in March 2002. This business had revenues of about MSEK
100 per year and employed 20 persons in the Nordic region. The other
operations in Systems (industry-oriented system components) were
integrated April 1, 2002 in the Components division. Order bookings and
profitability were positive in this business during the period.